Turbolinux gets new CEO

Ly-Huong Pham will take over as chief executive of Turbolinux on Tuesday, a promotion that will give her control over the company during a critical time of change.

Paul Thomas, former chief executive and the man who hired Pham in June 2000, will stay on as chairman, Pham said in an interview. Among her earlier positions, Pham spent 13 years as a programmer and manager at Wang and five years in charge of the user interface of Apple's Mac OS 8.

Though Pham will be officially named CEO on Tuesday, she's been running the company for months, which means she's lived through its recent crises. She was promoted from executive vice president of development to chief operating officer in February, at the same time Turbolinux laid off much of its staff. The staff cut took place shortly before the company scuttled its planned initial public offering in March and canceled its merger with Linuxcare in June.

Turbolinux, one of the four sellers of the Unix clone that IBM anointed to be among its global Linux partners, got its start in the Japanese market. Since 1999, the company has been trying to push into the United States--the stronghold of Red Hat.

But some are skeptical the company can pull through in a market increasingly dominated by Red Hat, the leading Linux seller, which is expanding internationally.

"The market has been consolidating around Red Hat," said Giga Information Group analyst Stacey Quandt. One major implication is that software companies with programs such as databases will make sure their programs work with Red Hat first.

Turbolinux benefited from the hype surrounding Linux, an operating system competing with Microsoft's Windows and Sun Microsystems' Solaris and one that's popular for use in the lower end of the market for networked computers called servers. In January 2000, the company trumpted the $57 million in investor money it had raised.

Not long after, though, the Linux hype collapsed and Turbolinux' Chairman Cliff Miller left the company. Linux companies are in survival mode, hoarding what cash they raised as they try to figure out a way to convert the continuing popularity of Linux into profits.

"This year is the year of hard work for Linux companies," Pham acknowledged.

Turbolinux, though, has enough cash to reach profitability under its current plan without having to raise more investments, she said. The company has fewer than 200 employees. "I'm very comfortable with our financial status, our burn rate (how fast the company spends its money) and our revenue," she said.

The company's strategy is to build on its boxed software sales--revenue that comes chiefly from Japan--to fund work on making Linux easier to integrate into companies' existing computer networks. Turbolinux and Linuxcare also will enlist each other's services when bidding for larger companies' businesses. Pham believes the technological challenges of using Linux are of greater concern than competition with companies such as Red Hat, SuSe, Mandrakesoft and Caldera International.